Question

Assume that kubin company produced 20,000 units and expects to sell 19,800 of them. if a new customer unexpectedly emerges and expresses interest in buying the 200 extra units that have been produced by the company and that would otherwise remain unsold, what is the incremental manufacturing cost per unit incurred to sell these units to the customer?

Answer 1

Incremental cost: This is the cost which is added or incurred by producing an additional unit product or providing extra service.
   Answer: The incremental manufacturing cost/unit incurred to sell extra units to the customers is 0. This is because 200 extra units were already produced and was supposed to be remain unsold as out of 20000 units only 19800 units were expected to be sold.. But the customer unexpectedly came and demanded 200 units which otherwise would have been unsold.